Meanwhile, sterling’s overnight volatility jumped to 23%, the highest level since last year’s general election, as the currency fluctuates amid continued Brexit uncertainty.

In Europe, the Eurostoxx 50 was down 1.2%, the French CAC fell 1.3% and the German DAX was trading 1.1% lower.

Markets were shaken last night after it was announced a draft withdrawal text for Brexit had been agreed by the UK and the European Union. Prime Minister Theresa May is due to hold a cabinet meeting at 2pm today (14 November) in order to seek approval for the potential deal.

Elsewhere, data out of Germany showed its economy had shrunk for the first time since 2015 in the third quarter as a result of a weaker trade position and lower consumer spending. German GDP fell by 0.2% compared with the second quarter, following growth of 0.5% in the second quarter.

In October, year-on-year price growth remained at 2.4%, despite analysts’ predictions of a slight rise to 2.5%.

According to the Office for National Statistics (ONS), the largest downward contributions to the October figure came from food and non-alcoholic beverages, with food prices falling 0.1% between September and October, compared with a rise of 0.5% between the same two months a year ago.

Other sectors that saw price declines were clothing and footwear, and some transport elements.

However, this was offset by rising prices for petrol, diesel and domestic gas. Petrol prices rose 0.4% between September and October, while diesel prices jumped 1.8% over the period.

Other smaller upward contributions came from items in the miscellaneous goods and services, recreation and culture, and communication sectors.

Laith Khalaf, senior analyst at Hargreaves Lansdown, said: “Inflation is still above target, but tolerably so for the moment. The effect of weaker sterling has faded, but rising fuel and energy prices have taken up the baton in keeping inflation elevated. Moreover wage growth is at its highest level since 2008, which suggests domestic inflationary pressures might start adding to the mix too.”

“Brexit is still the elephant in the room when it comes to the future path of inflation, and consequently of monetary policy. That’s because the pound now waxes and wanes with the Brexit negotiations, and that has a big impact on how much UK consumers pay for imported goods.”

“A disorderly Brexit would see the pound fall and inflation rise, and if you believe Mark Carney, that could mean a rate hike or a cut. Meanwhile what the market sees as a positive Brexit deal will deliver a higher pound and lower inflation, and would most likely embolden the Bank of England to raise rates more aggressively.”